Future Energy Insights
Bringing together industry leaders, innovators and global thinkers, Future Energy Insights by the World Future Energy Summit takes an in-depth look at renewable energy and sustainability. Featuring lively debate and passionate discussion, the series covers six core topics: clean energy, water scarcity, smart cities, circular economies, waste management and climate change. It shines a spotlight on the critical issues and major gamechangers shaping the sector today.
Future Energy Insights
In Conversation with Robin Mills: The New Energy Opportunity
Use Left/Right to seek, Home/End to jump to start or end. Hold shift to jump forward or backward.
The energy transition is moving beyond deployment to a new phase of transformation, creating opportunities across technology, investment and infrastructure. In this episode, Robin Mills welcomes James Allan, Head of Energy, Economics and Climate at the British Embassy in Abu Dhabi, to explore what it will take to scale the next generation of clean energy solutions and turn ambition into commercial opportunity. They discuss the falling cost of renewables, electrification, critical mineral supply chains, carbon capture and AI, as well as the growing potential for UK–UAE collaboration. As businesses look to turn the energy transition into growth, they examine where new markets, technologies and investment opportunities are emerging, and what companies need to do to position themselves for what comes next. Ahead of the World Future Energy Summit, they also consider how collaboration, innovation and investment can accelerate the transition and shape the opportunities of the future energy economy.
Powered by World Future Energy Summit, the Future Energy Insights show seeks to address the biggest challenges shaping the future of energy today, both in the Middle East and around the world. Find us on social media at @worldfutureenergysummit and visit our website www.worldfutureenergysummit.com.
Hello and welcome to Energy Insights by the World Future Energy Summit. And for today's episode, I'm joined by James Allen, who's head of energy, economics and climate at the British Embassy in Abu Dhabi. And we're here to discuss the energy transition. So welcome, James.
SPEAKER_00Thank you very much, Robin. It's a delight to be here today, and thank you so much for inviting me.
SPEAKER_01Sure. We're at a very interesting, I'd say, uh, an inflection point perhaps in the energy transition. Um we've seen enormous developments and a lot of progress, but also some setbacks over the past few years. Um I wonder if you could just just start by giving us your your views on where we are standing in the energy transition at the moment and and how the the turbulent events of the past few months have maybe uh affected that.
SPEAKER_00So when you talk about a time of inflection, Robin, I'm inclined to agree with you. When you try and put aside the words that are said and looked purely to the data and the hard facts. So look to the UK, which I'm representing and where I'm from. Today's a sunny, moderately windy day. And less than 7% of our energy is being generated from fossil fuels, so from the remaining gas plants that are on. A bulk of the rest is from wind and solar. Globally, energy renewable energy capacity is approximately 50% of global capacity and 30% of generation. These are stats from the International Renewable Energy Agency for last year. And as you say, the last few months have hammered home the repeated nature of energy security shocks that come from relying on fossil fuels. But to say that we are not well into the start of an energy transition, I think it's very much the case that the energy transition is here and is here to stay. It's just a case of how quickly and how fast and where we'll move the fastest.
SPEAKER_01Yeah, thanks. And I find the you know the UK example is a very interesting one, as you say, because okay, we're perhaps today at a particularly favorable day for renewables, but indeed uh um renewables along with nuclear power, so low, low carbon generation in general, as you say, uh the vast majority of the UK's generation today. The UK has been one of the world's fastest decarbonizing major economies, if not the fastest, over the past few years. Coal has been completely removed from from the electricity generation sector. So a lot of impressive achievements. Um but you also have some obviously some concerns and pushback and and contrasting political opinions on on the way the UA the UK has gone on that.
SPEAKER_00So thank you for the the compliments, and it's right to say that the UK's transition is is going very, very, very quickly. But it is also fair to say that the UK, along with many other countries globally, shares cost of living challenges, and it's something that the new Prime Minister Andy Burnham has very much laid out as a challenge. That we must transition and we must also transition in a way that gets people's money into people's pockets so that they're able to uh to to live their lives and so the burden doesn't fall on people. But uh when it comes to renewable energy and the price competitiveness of it, you mentioned an inflection point before. We've definitely hit that where renewable energy is now price competitive with uh dirty sources. So the last auction round that the UK held, and there are contracts for difference for our offshore wind, we achieved prices that were roughly 40% cheaper than if we had comparable gas generation. So the future is certainly renewables, but it's about making sure we do that transition in a way that's also fair and equitable and doesn't put undue burden on households that are finding globally challenges at the moment.
SPEAKER_01Yeah, and I guess we've seen the past few years, you know, solar power has made tremendous strides, cost has fallen very dramatically, the amount of deployment has gone up hugely, um, batteries have advanced a lot as well, and again, costs have fallen, so that's very helpful, obviously, for balancing variable renewables in the system. And wind has had its, you know, its ups and downs in the maybe in the kind of the short term. And there were, you know, some projects have struggled with costs and and and delays and so on. But again, I if we I guess if we step back big picture, um again, the story of wind power and particularly offshore wind is again big cost declines and and a huge amount more deployment. And the UK uh obviously very strong in offshore wind.
SPEAKER_00Yeah, exactly. And I think it's come a long way in a relatively short amount of time in terms of bringing down cost, increasing reliability, and just scaling up, and that's largely through some significant investments off the coast of the UK. So the side the size of these wind turbine blades are now enormous and are quite a sight to see in terms of their scale and the amount of electricity they're able to generate. Um, there's still a way to go in in some sectors. So, referring back to this most recent recent auction for uh for UK offshore wind power, we had two separate categories, one for fixed offshore wind and one for floating. And to encourage the development of that sector, which is what we've done throughout our history of trying to bring renewables onto the grid, we've allowed different price setting for that newer technology. So the cost of floating wind is more expensive in the short term, but the idea being the technology will develop and you'll find that floating offshore wind will again increase the scope of where it can be deployed and uh the reliability of the system.
SPEAKER_01Right, because you could move out into deeper water and more remote areas and maybe areas that have more consistent wind or higher wind speeds and so on.
SPEAKER_00And moving away from the UK, it means there's greater global opportunity because not everywhere has the shallower waters that allows for that fixed seabed operations.
SPEAKER_01Yeah, yeah, a good point. And we think of some of the other energy scarce nations like Japan, of course, which is where they're surrounded by rather deep seas where floating wind uh looks like a good option. Um now, you you know, we've talked about how renewable energy costs have come down. I think, you know, there's a couple of kind of points I want to unpick there. The first one, obviously, you've got a new prime minister just uh just entering office, Andy Burnham. As you say, cost of living is is a very uh a top priority for him, um, understandably. Um renewable energy has has achieved great cost competitiveness. I guess people are not yet seeing it in their pockets, you know. Um maybe help us think what when you when you think that that will start coming through.
SPEAKER_00So for the energy transition, moving to renewable power is only part of the journey. The electrification of our everyday lives is the next step, and the step where it then will begin to make even more of a difference. So the rollout of electric vehicles, the role of electric, in our case, heating systems in the UA, it is more about cooling. But uh the rollout of systems that are electrify both domestic but also industrial processes, which can then be connected to that renewable energy, will be will be vital to kind of flow through into generating savings that people can actually see.
SPEAKER_01Yeah, that's uh that's a great point. I'm glad you kind of broaden it beyond just the the generation to the whole electrification side. Um, you know, and a couple of a couple of thoughts there. Obviously, you mentioned uh you know energy efficiency, and um there's various ways to get that, but of course electrification is one of those, right? If you think about gas, the traditional gas-fired heating in the UK, obviously quite a cold climate. Most houses heat with gas. Um a gas boiler is what, 80%, 90% efficient? That sounds pretty good. But then you think that a heat pump with electricity is 300 or 400% efficient because of the of the way they work, right? So a much more efficient conversion of those of those electrons from solar or wind power into heating, which is what what we really need.
SPEAKER_00Yes, you're you're you're quite right in that regard. And that's why, from a U UK perspective, we have encouraged and subsidized the rollout of uh of heat pumps of uh solar connected to domestic as well as grid scale opportunities.
SPEAKER_01Yeah, and then the other cost of living issue we face, uh a very pertinent one right now, obviously is the cost of fossil fuels. Um we've been through a couple of major crises in in fossil fuels in recent years. First, the the Russian invasion of Ukraine and the cutoff of Russian gas to Europe, which which obviously pushed up gas prices enormously within Europe and that they did fall back, but never fell back to the the pre-invasion levels. And then more recently, of course, the conflict in the Gulf also uh pushing up oil and gas prices. Now, I guess the energy transition agenda, you have obviously the renewable again in renewables, which is is uh primarily replacing gas, and you have the the rise of electric vehicles which are helping to replace oil. Um, you know, maybe uh you mentioned 93% of the UK's generation today, let's say, coming from non-gas sources. So that's that ought to be helping on those bills. How is the energy transition in general helping the UK in this in this world of kind of volatile oil and gas prices? So it is about energy security.
SPEAKER_00So you would be a very brave person to bet against volatility and fossil fuel prices in the future. You'd certainly be betting against history. Obviously, the most recent example of that has been driven by the Iranian conflict and the Russia-Ukraine conflict. During COVID, we had a different kind of fossil fuel price volatility. So ultimately, you will be a brave person, as I say, to bet against future price volatility. And price volatility is not just bad for households to adapt to, but it's also bad for business to be able to adapt to. You need certainty to be able to invest. And if you have certainty in another aspect of your cost base, that makes it a lot easier for you to be able to invest and predict what you're going to need into the future. And on top of that, there is the security of supply aspect of where are you getting these things from. If you're able to generate at home, uh you are in a much safer place than if you have to bring that in. And I wonder, we might want to touch on wider supply chains too, because there are other concerns too around uh supply chains outside of just the fossil fuel place.
SPEAKER_01Well, that's right. I mean, the the oil and gas supply chain is a very immediate one. Obviously, if your oil gets cut off, then that you're in trouble, or if the price doubles overnight, uh that's that's very difficult for the UK, but you know, even more for some other countries. Um but then you have, of course, the clean energy supply chains as well. And we know about the the concern depends on China for solar components and battery components in particular, um, the challenges for for manufacturing, let's say, for electric vehicles in Europe, uh, and then the the supply of scarce raw materials. And you know, we we all hear about rare earths and lithium and so on, but there are several others which are uh supply chains which are dominated by by China, or indeed, in some cases, are dominated by the Gulf and face interruptions from the conflict there.
SPEAKER_00Yeah, so from a UK perspective, we have identified critical minerals that are important for the energy transition, but also industry more widely. And our approach to this is very much that it is never good to be reliant on a single single supplier and a single source. And so we have been encouraging our diversification of supply. I mean, our kind of our strengths are more in the financing of that space, but also within the UK, we do have particular areas where we have access to some of these critical minerals such as such as tin and others in say the southwestern Wales, which we're trying to encourage those emerging and regrowing industries. But also an area where the UK has a lot of strong research and increasing amounts of intellectual property and companies that are really working at the cutting edge of the technologies around recycling and reuse. Because that is again one of the joys of uh this new energy transition, that it's not burnt and gone. But let's say you have a solar panel or a wind turbine or a generator that comes to the end of its life, as long as you can recycle it from it and extract those critical minerals and key metals, you're able to reuse them. And I think that's going to be only a burgeoning market and one in which the UK has some really exciting uh companies.
SPEAKER_01Yeah, well, those are really interesting points. Yeah. So there's some development of critical minerals within the UK, um, but perhaps kind of more broadly, as you say, the financing of projects, I guess, elsewhere, maybe cooperation with other partners who are in a similar position of vulnerability with European partners, with perhaps Japan and so on. Um, and then and as you say, the advance in new technologies for, I guess, finding developing critical minerals, but uh you particularly point to the recycling opportunity, um, which uh become more and more important as the energy transition advances, and we have more and more, I guess, kit that's becoming obsolete and uh and then needs to be recycled.
SPEAKER_00That's right. And I I mean it's certainly not just uh a UK and UK and Europe concern. I you can see from the UA that you I'm sure you've you've heard and read about the investments that UAE companies are making into mining in third countries, the the pilot schemes are being undertaken by UA entities here to try and extract more minerals and critical minerals. And it's certainly something that is a global cooperation effort to try and increase uh the diversification of supply chains in this space.
SPEAKER_01Yeah. I'm glad you bring us to the UA. We're obviously sitting in the UA today. We're in we're in in Dubai, you're of course uh you know the at the embassy in Abu Dhabi. Um the UA has been a very important player in the energy transition, I guess an emerging one, one that's gained uh gained in in uh in prominence in recent years. Um and there's a few aspects of that. Uh you mentioned the critical minerals aspect. The UA does indeed produce some of those materials and minerals itself, but perhaps more importantly, it's a partner in developing those uh those uh those assets uh elsewhere in in Africa and and so on elsewhere in the world. Um but the UA is also, of course, a very prominent developer of renewable energy both at home and internationally. Um has a very large, successful civil nuclear program, um, has a very large and very prominent solar and and battery uh renewable program, and has been a very active investor overseas, including in UK wind, as we mentioned earlier, but in in many other projects. Um where where do you think where do you pick out in the UA that is particularly kind of interesting amongst those areas or or other areas that catch your eye?
SPEAKER_00So, I mean, a really obvious one where the UA really is trailblazing is the base load solar plus battery uh capability that it's generating on a scale that is incredibly impressive and is incredibly important when we need base increasing amounts of base load capacity for things like data centers that are only going to be increasing the amount of energy that they require. And being able to demonstrate that they can do it and do it at the scale that they're doing it and the pace that they're doing it, I think will only be a halving of things to come for other countries to be able to adopt and do similar things, hopefully within the wider region uh and and elsewhere as well. So I think that's certainly super impressive. Um, kind of oversees the role of of Mazda and others, including Taca, in terms of their investments and their joint uh collaborations in in other countries has been really impressive. So I talked a bit earlier about the most recent renewables auction uh which we had in the UK. So Mazda was actually one of the big investors off that. So, in a partnership with W R of WE, uh achieving three gigawatts of power in the South South Dogger Bank, which will be delivered in coming years in offshore wind. They are significant investors and important investors into UK offshore wind, but also batteries, um, as well as as well as the wider grid by both Mazdara and Taca. So they're really important UK partners, but also globally their their target is to become a global renewable energy power. Um, I believe it is 100 gigawatts by the end of this decade, and then 200 gigawatts beyond that, and possibly even more into the future of capacity globally, which is which is truly impressive and making them uh an international electricity power of uh of the future.
SPEAKER_01Yeah, so I mean Mastar, the the Abu Dhabi future energy company, you know, state-owned renewable energy champion, um always picked up as the key player from the UA in that sector. Um you also mentioned Taker, of course, as the national utility, also an important player, both domestically and internationally. Um the Mastar story is a very interesting one, I think, because you know you mentioned some of their projects like the 24-hour solar electricity project with with the batteries, uh five gigawatt project, you know, very uh very large scale, uh very competitive cost for that. Uh and you also mentioned wind, and that's kind of interesting because the UA is not a very windy country. It's not one that's developed wind power itself to any significant extent, but it is, as you say, a major investor in in offshore wind in the UK now. Um, what do you think like attracted them to the UK, other than that that it being windy, of course?
SPEAKER_00Well, I mean, uh it depending on on your perspective on this, the UA is lucky or unlucky enough to not be a very windy place. So uh not necessarily having the wind speed, although they do have some some wind turbines uh uh across parts of the UAE, but they are not going to be at the scale uh due to the wind speeds, as you might be able to get in the North Sea of the UK. So I think we are blessed by that natural resource. Although if you're walking some of the coastal beaches of the England or Scotland, you might feel be feeling less generous about the amount of wind that you're having to battle against. But it is wonderful for us to be able to have that natural resource. But equally, it is more than having the natural resource that I think has allowed companies like Mazda and others to be able to invest and feel that they're likely to get a secure return. It's the importance of government working in collaboration with business, setting a framework that ensures that they feel comfortable, they can get a guaranteed return. And that's where I went back to these auction and guaranteed strike prices through contracts for difference, which make a huge difference. Um and the UK has also long been somewhere where the UA has been comfortable investing and has been an important partner for the UK for many, for many years. And I think it's just making sure the investment environment is correct to allow that to happen. And if if you if I may, in third countries outside of the UK, we're also looking to try and develop opportunities for collaboration between UK entities, so development finance institutions, impact investors, and UAE institutions to be able to invest in climate finance into third countries in the developing world, where maybe those um well, both that history but also the that investment environment is maybe not quite as easy to navigate as it is in the UK. And I think that's a real big area of opportunity because for to be able to really progress the energy transition, it cannot be just for the UK and the UAE to transition, but it must be a global effort and it must be possible for all countries to be able to access clean, green energy to power their economies.
SPEAKER_01Yeah, that's a really interesting point, I think, because you know the certainty that the contracts for difference give, uh, the assured price over long term for the investors in in the UK renewables has been very important, of course. Um, we've seen some other countries that that have that have backtracked on their renewable energy uh um incentives and and have withdrawn projects that were previously agreed and so on. That obviously isn't pretty negative for investors, but the UK so far has a good track of record in that in that regard. Um but then you mentioned the the cooperation in third countries. We've known that, you know, I guess for for years, right, the the the renewable energy potential in Africa is huge, both in solar and wind and other things like hydropower as well. Um the continent's need is very great, but the actual deployment has been has been very limited because of the difficulty in in getting financing for these projects, uh given all the risks and uncertainties. Um I think that's a very interesting approach you mentioned with the UA working together with with the UK development finance and so on. Um we've seen the UA entities obviously quite prominent in Africa, also in other parts of the world that maybe were underserved in renewables like Central Asia. Um those are kind of particularly areas you're thinking of for that kind of cooperation?
SPEAKER_00So my role as being part of the embassy and part of the government is to try and introduce people, try and create frameworks. So we we funded a project that tried to create different approaches and structures of different financing vehicles that would allow people to have confidence in investing collaboratively together through such as first loss capital, through such as uh the structuring those deals in innovative ways so that people are comfortable with the different w return and risk profiles uh that might be needed to get some of these things over the over the line. But we then kind of leave it very much to those individual entities and companies to take for the specific projects, which could be could be in Africa, could be in central, could be, it could be across the globe. So I don't want to kind of narrow that scope, and it is also not my job to do so. Um but yes, I would agree with you that the UA has done some impressive things in in countries like Uzbekistan, uh and certainly seen investment globally. So I see no reason to try and restrict that geographically.
SPEAKER_01Yeah, I'll just give you a couple of examples, but obviously there's many other places that that uh the model could be applied, right? Um so very you know good.
SPEAKER_00Very early stages, very early days, but um we are we are hopeful we'll to see more on that in the future. And that there can only there can only be more demand and more need for climate finance into these countries, and we're gonna have to do it in innovative ways because the availability of Grants, the availability of development capital is uh is not what it maybe once was. And but there are ways that we can do this. We just need to put the energy and effort behind it.
SPEAKER_01Yeah, I think some of the financing mechanisms you mentioned are interesting, and that's obviously a big strength of the UK and the City of London, right? Um, you mentioned a few a few a few examples there. Um maybe tell us a bit more about that. I think you know the practicalities of that.
SPEAKER_00So within the UK, we have our development finance institution called British International Investment, who go into some of the more challenging markets, they have a mandate to go into the more challenging markets in the in the global south. And they are both uh ultimately meant to be an entity that returns a profit, but equally one that has an impact. And so that allows them to take a much greater degree of risk than an average um average financial institution might be happy taking. Uh also they have an amazing network around the world of people who know local conditions, they have a long history from the from the 50s of kind of being in in countries around the world. And so that kind of network and understanding of local conditions allow them to maybe take and accept more risk than than they otherwise would. And if you can compare that with some of the enormous amounts of capital uh that are that is available elsewhere that maybe is less willing to take on levels of risk, has a different returns profile expectation, uh, you you're really onto a good thing. And that's what we're really hoping to see.
SPEAKER_01Yeah, yeah, that's an important one. I think been for a while how to unlock all that capital for some of these countries that is NG short countries which have great natural resources, but uh in terms of renewables and and potential, but uh but struggle on the financing side. Um and uh hopefully I guess you get some kind of a virtuous circle where greater energy supply means economic development, improves institutions, you know, helps the economy grow more broadly and uh and then attract more capital in that way.
SPEAKER_00I mean that's right. Energy is the lifeblood of a of a country. If you have unreliable, expensive energy, uh it is it is very difficult to have have other forms of productive activity. Um it is a key constraint and a key enabler of a productive growing economy. So that's what we want to see across the world.
SPEAKER_01Yeah, yeah. I'm always reminded in that example, I remember being in an African, uh one African West African country some years ago, and they had a solar panel which had been donated, I think, by a German development organization. They were charging mobile phones with it. But uh the person who'd who'd who ran the solar panel was then was then expecting people to pay for this. And I calculated they were paying more than a dollar per kilowatt hour of electricity for this solar panel, which uh, you know, now of course you can get so solar power at uh in in in Africa at three to four cents per kilowatt hour, right? So there's just an enormous gap between what people were willing to pay, albeit for a very small amount of electricity, versus the the cost of generation.
SPEAKER_00The opportunity is huge, as you say. Um there's a huge margin there for uh to be filled. Uh it's it's it's it but it is difficult.
SPEAKER_01So we've talked uh quite a bit about um the cooperation between the UK and UA in aspects of the energy transition. We talked about UA investment going into the UK, we talked about quick collaboration, financing and technology and so on in in third countries. Um could you give us your thoughts on the other way? You know, UK coming into the UA in terms of businesses, opportunities, technologies, um, investment in in energy transition approaches uh here in the UA?
SPEAKER_00So the UK is actually the number one FDI stock investor overall, not just in the energy space, into the UA economy, which I think just shows the importance between in both directions of this economic relationship between the UK and the UA. And with that investment comes people, comes skills, but also uh comes technology and expertise. And I think one area that's really, really interesting. I mean, it's it's it's small currently, but it's only going to grow, is carbon capture and some of the UK expertise in technology, which is the companies that are coming out of the UAE and also the wider region and are looking to store carbon underground, a really, really interesting one, which also allows the production of hydrogen up in up in up in Iraq. Um I think that's a really neat, a really niche but really nice explanation of how some of the technology and insights and things are developed in the UK can come out here and find a fertile ground to develop their companies further, to uh obtain but also invest themselves and bring skills and and interesting technologies to this region, which is one that in the UAE is somewhere that really embraces these things and new and new technologies and new ways of doing things, and especially in the energy space.
SPEAKER_01Yeah, that's a really interesting point and a very interesting statistic on the FDI. You know, um, as you say, not just energy, but a big part will be energy, I guess. That you've also got Shell and BP who are longtime energy investors here. You've got several major energy services companies from the UK who've been here also bringing their skills. Maybe they developed their skills around the North Sea and uh and have come here and are moving on from oil and gas to to uh the energy transition opportunities as well. Um carbon capture is, as you say, is one that's kind of been uh dear to my heart for many years. I think it's interesting because it again moves the conversation a bit beyond just renewables and solar and wind and electricity to decarbonising other parts of the economy. Um the UA has big carbon capture plans and existing projects as well as we know. The UK developing some major carbon capture projects. I mean, it seems like a big area of synergy and cooperation there.
SPEAKER_00Exactly. And the UK is the UK is committed to invest, uh I believe it's £25 billion into carbon capture storage in the coming decades. And creating pilot projects, often in some cases in collaboration with with UAE entities such as AdNok, I think is going to be really important going forward. But it's it's not just oil companies that are leading the charge on this. As everyone can see, at least everyone that I know back back in the UK who have kind of experienced heat waves, and those across Europe that experience heat waves, the planet is only getting uh getting warmer. And unfortunately, it is likely that we're going to need some sort of direct air capture or other forms of carbon capture to be able to meet our climate goals. And what that means is that this is an enormous opportunity. Uh I've seen estimates that it could be worth trillions in coming decades. So I think the scale of the challenge there is one, a different one to that of electrification and the rollout of um solar panels, wind, etc., which is proven known technology. We know how we do it, we just need to do it faster. Um, this is kind of more of we know certain ways of doing things, whether that through net through nature-based solutions or through um some of the storage in depleted oil wells. But the new technologies coming through, the new ways of doing this, and especially the ways of bringing the price down of doing it, is going to be vital as we go into future years.
SPEAKER_01Yeah, really interesting. And you mentioned just uh slightly before that the Russell Kleimer uh the RAC project of developing uh hydrogen, and there's a couple of things I think going on there with the producing hydrogen from the ground, um, capturing carbon dioxide underground, and also in in the emerald of Fajiera turning carbon dioxide into solid minerals underground to trap it permanently. Um, those, I guess, all areas which the UK is also developing and bring some techn some technologies in.
SPEAKER_00Exactly. Um and it's where the UK plays to plays to our strengths. We have strong universities, strong academia, and then also spin-outs and companies that are looking to develop these things. But then when when coming to the UA, there is uh there's very good geology across the UA for this sort of activity, whether it be uh under the salt crusts offshore, or whether it be the uh type of rock that exists, particularly in the northern emirates. The UA is very well suited to this sort of activity. It also has the right human capital, the right people to be able to do it. It also has the investment um available often to be able to do these things. So it's an exciting place to do it, and I think it could easily become somewhere that is also seen as another world leader in in this space. But we'll have to wait and see. As we say, it's an emerging technology in an emerging area.
SPEAKER_01Yeah, yeah, sure. Emerging, but um, I mean, there are it's one amongst a set of a whole range of technologies which are all interesting. Some are you know the more incremental ones um that were honed in in the UK, some are more kind of breakthrough, as you say. Um, there's a lot of UK companies here, a lot of obviously a lot of British individuals, um, but a lot of businesses who maybe could be here or would like to be here. Um what what do you think they should know? What what would help them in in coming here or or being successful here?
SPEAKER_00So there's some things that I would say to all British businesses looking to come out, um, and I think it's particularly true in the energy space, is that the UAE can be something or seen as something of a transitory country. But the idea of coming out for six months, twelve months, dipping your toe in the water, seeing what happens, is an approach that almost never works. Companies need to set out with the idea that they are looking to establish ideally a some sort of physical presence for a good number of years and then sit back and reflect as to where you've got to. If you're not willing to make a commitment, I think interlocutors in the UAE see this very often that a lot of companies will be passing through. They want to see that you're committed, they want to see that you're going to endure, you're going to last, you're not going to be gone by the end of the year. Um, and you are committed to your presence here. And then kind of secondly, relationships really matter out here. And so that means that I think to build those relationships, to build that faith, you really need to make sure you're looking at a commitment of a period of time. If you're not commit if you're not willing to do that, then perhaps reconsider. Um I think another kind of big question that is very topical right now is uncertainty um about the region and about the conflict with Iran and what will happen next. So this is more my economics hat on. The There is there is no certainty. There isn't there is only uncertainty about what will happen next in terms of the uh the conflict. I'm afraid I can't give you certainty about what will happen. But what I can give you certainty, which is very much reflected in the history of the UAE and through its actions so far, is that it will in all scenarios, it will undertake policies that will lead to successful outcomes. It will react and act positively, quickly, and well to almost all eventualities. And what and what this means is that the likelihood of the UA coming out of this in in the future, I don't know when, stronger and in a position where it is a more desirable place to invest in a strong economy globally and a strong important player globally, which is why the U UK considers that the UA is one of its important future and current partners, is that we only see them becoming more more important and uh a greater potential growth market, but also a greater potential partner globally. And so all that means, I think, is that ultimately there will be bumps along the way, but uh the the the kind of the long-term outlook probably remains largely unchanged for the UAE as a as a strong a strong location for for UK expansion.
SPEAKER_01Yeah, thanks. I think that's been a lesson of the history of the UA, hasn't it? That it there's been obviously various challenges for the country and the region through its history, uh, and the UA has generally taken that as a kind of a springboard to to do things differently, to adapt and and to to um to come out of those situations even stronger and maybe go in in a somewhat unexpected uh direction.
SPEAKER_00Um COVID, the global financial crisis over and over again.
SPEAKER_01Exactly, exactly. And uh and to uh uh and to and to adapt and to provide something that's necessary for the wider region and and for other parts of the world in in these times of crisis. Um and the the energy transition investments I think are a good sign of that kind of resilience. You know, the solar power, the nuclear power here um through this crisis have been extremely valuable parts of the energy system to have and have helped keep keep the country running.
SPEAKER_00Precisely. And I think that's another advantage from being able to transition and diversify your energy sources.
SPEAKER_01Aaron Powell You mentioned, of course, one of the topics of of of the day, if not the if not the century, James, and that's of course AI and data centers. The UA has been one of the prominent leaders in developing uh AI, I guess, both both for the use in in its own economy and particularly for the energy sector and other parts of the economy, investing very actively internationally, investing in in some of the big leading companies in the AI sector globally, um, but also in developing its own data center capacity. And a big part of that, of course, has been its wealth of low-cost, low-carbon energy, which make it a very competitive place to put data centers. Um the UK has its own big AI ambitions, of course. Um, one of the leading figures in UK AI was actually uh a uh a contemporary of mine at universities. So uh Demis Asabis, you know, uh Nobel Prize winner and so on. Um obviously one of the top figures globally in that and a sign of just how successful the UK, uh the UK has gone, intellectual uh side is in AI. Uh maybe you could uh tell us a bit more again where you see the kind of UAE and the UK tying up in AI and making advantage of some of these, these, uh some of the energy advantages that the UA has and and and other uh aspects.
SPEAKER_00Yeah, as as you mentioned, the UK has real skills and incredible talent in the AI space. So Dennis is uh isomorphic, but also obviously DeepMind are real impressive companies uh doing incredible things. So I think there's a real way that just generally there's a matchup between UK talent, UA vision direction, and capital deployment. I think if we can marry those things together, we both have global AI leadership ambitions, but we'll only advance them faster and further by doing so. Um, I mean, specifically to the energy space, I I think it's remarkable we've spoken so long and not actually touched on AI yet. I think it might be the first in a conversation I've had because there are so many opportunities in the energy space for AI to both improve the systems, improve the generation, whether it be through your digital twins, whether it be through your uh preventative maintenance, whether it be for so many opportunities that uh UK companies and UA companies are working on and developing opportunities in this space. Um, the other really interesting flip side to the coin, as I mentioned, is the energy demands from these data centers. And I think the working assumption has always been that it's a challenge for renewables because these centres required significant base load, they need to always be on, um, which is why I would point to us a lesser-known trial done by the national grid in the UK, where they actually worked at greater intermittency, demand management from data centers and managed to get some real success in being able to better manage demand from a data center, rather than this kind of working assumption that everything has to always be on and therefore requiring acquiring greater baseload, base load power without any contribution to the grid balancing that will be needed going forward. So that was a really interesting um pilot done by by the national grid in the the UK, and I think will continue to be a greater uh of great interest globally.
SPEAKER_01Yeah, those are both very interesting points. I think the point about AI and technology is a very good one. Um there's a whole range of applications in the energy sector, and I think again, we were just talking about Andy Burnham a bit earlier, um, and obviously from Manchester, and uh Manchester is a center of graphene development, you know, wonder material. Um, you know, there's a lot of areas, I think, for AI to contribute to understanding these new advanced materials and and uh looking through millions of different chemical structures and finding ones that have particular applications. Uh and the graphene, of course, are applicable in the electronics and so on as well.
SPEAKER_00And of course, we have the University of Manchester here here in Dubai as well, as well as uh as well as back in in Manchester, who are the developers of graphene, but also in terms of the UAE, they've been very interested and investing in uh companies that have been adopting and spinning out uses for for graphene. As you say, advanced materials that will just be accelerated in use through AI developments, but also uh be essential for us to create cleaner, cheaper energy.
SPEAKER_01Yeah, indeed. And then the whole energy balancing side, as you say, using AI to to uh to balance the grid, but also um adjusting the the the uh the power demands of data centers uh to to um to fit with the the input of variable renewable energy and demands on the grid. And I guess we're we're coming uh and we talked a bit about electrification to a more complicated electricity system, right? Which will be taking in generation from solar panels on people's roofs and so on. We'll be we'll be charging electric cars, we'll be we'll be running uh heating systems and cooling systems. Um there'll be a lot more demands on the electrical system, a lot more variability, um, and therefore we'll need a more intelligent system to manage that.
SPEAKER_00Exactly. And AI will only help us in doing that. Um I have to say it's beyond my technical remit, but uh it it's certainly something that's going to have more of a focus going forward and be more of a challenge for those managing the grid systems and require investment into those as well as into the actual generation side.
SPEAKER_01Yeah. Well, thanks so much, James. I think that was a really uh fascinating discussion. It's great to get the the uh the UK UA combined perspective for someone who's so deeply into the the energy and economics scene uh here here in the UA and brings the knowledge of the British side and what the UK is looking looking to do here and looking to do with the UA. Um a lot of progress in in somewhat different ways, but I guess complimentary ways from both countries in in the energy transition. So thanks very much, uh James Allen, um head of energy economics and climate at the British Embassy in Abu Dhabi. Pleasure to have you on the show.
SPEAKER_00Thank you so much for hosting me, Robin. It's been a delight. Thank you.
SPEAKER_01So thank you for listening. That's all from this episode of Energy Insights with the World Future Energy Summit. I'm Robin Mills. And if you'd like to join us in person, please do register for the World Future Energy Summit being held from the 12th to the 14th of January 2027 in Abu Dhabi. I hope to see you there. Thank you.